Bitcoin Forum

So today I was looking at coin distribution on BitRex beta. If you haven't done so yet then I would recommend taking a look (https://beta.bittrex.com/Market/Index?MarketName=BTC-XPY --takes you to Paycoins for example). In every single one I checked the distribution was like this:


https://i.imgur.com/G6p0FD7.png

Bitcoins distribution currently looks like this:

https://i.imgur.com/AU7iYJg.png

Before I continue I must say I do understand that lots of these address will not be in use, and many will be multiple addresses for one person. But I am going to try and work out wealth distribution off this data. First of all I will excluded wallets in 0-0.001 range. Which leaves 1,643,642 wallets. The top 98 wallets contain 19.66% of all the BitCoins currently in existence. That's a staggering 0.0059% of the BitCoin community that own 19.66% of all the wealth.

Now to include the 1000-10000 range. This range brings the number of wallets into existence to 1543 and the wealth held up to 43.89%. But even this staggering amount of BTC wealth is held by only 0.093% of the community.  

At 100-1000 the number of wallets stands at 15,356 and a combined wealth of 67.64%. Here the wealth is held by 0.93%. < The top 1%. Now below I have inserted a table from Thomas Pickety: Capital for the 21 century, which has rough Wealth Distributions across the globe. This data is not perfectly accurate but gives you a rough idea.

https://i.imgur.com/QEdGQ2X.png

Call modern day social systems what you want, and even at those quite frankly shocking levels of parity, there is still a much more fair distribution of wealth from 'capitialism' than from Bitcoin (35% at the top 1% vs 67.64% for BTC).

Lets continue at 10-100 the number of wallets stands at 115,281 and a combined wealth of 94.49%. This staggering wealth is owned by just 7.11% of the Bitcoin world.

So I ask you all this, with such concentrations of wealth comes massive power. If the system was to ever change to a one backed by cryptocurrency, then how can this minorities monopoly over the money supply be a good thing?  Do you think this is in anyway fair and if we were to create a new currency with fairness at heart then what would be the ideal way to distribute?

I personally don't see how BitCoin can revolutionise the currency scene anytime soon. To me its just new monopolies with new faces, but no real fundamental change. That's not to say I don't think BitCoin is revolutionary, or something quite spectacular, as I do. But I struggle to see how cryptos in this format really stand to change society for the better.

I am surprised this has got less attention. I have never thought of any of this before. I think for cryptocurrencys to be a game changer than wealth distribution does need to be addressed.

https://c2.staticflickr.com/6/5083/5371631857_303a5779fb.jpg

Only guns and violence can distribute wealth equally, a currency does not choose winners and losers.

Want to distribute wealth equally? Buy now while the price is low. Give it away when you are rich.

We get some socialist on here about once a month bringing up their insanity. For them I say...Bitcoin is not for you. Stick with your notes.

http://media.coindesk.com/2014/02/Screen-Shot-2014-02-14-at-2.38.44-PM.png

Attack this:


How can you buy into a system where you know the cards are stacked against you? Not to say they're not in the current system. But in BTC their is more wealth inequality then societies with a monarch. How is this system going to help society advance? 

Or maybe we can start with a system where everyone has an equal share, then whoever comes out on top obviously did so on personal merit, grit and determination.

You had equal access to Bitcoins in 2009 as everyone who mined them. You have equal access to bitcoins right now at such a low price.

Or is it still too risky? Those that take the greatest risks gain the greatest rewards. Kudos to those who took risks in this realm.

You should be looking to the people with guns if you want wealth redistributed.

Are you buying right now? When 1 Bitcoin is enough to run a nation's economy will you be upset about people holding 10?

I would like to be a champion of equality in terms of wealth distribution but sadly there is no such thing in this world. The world that we live in, in reality rewards those that seek opportunities, took the risk, be early adopters, smart, innovative and like it or not that is how it goes. Nevertheless, rather than trying to focus on wealth distribution just concentrate on the technology and innovation and how we can use bitcoin to our advantage.

Your missing the original question. How it BTC going to rid the world from the plights of fiat money in its current form?

For example: lets presume you are correct and one BTC could run an entire economy. Then how could BTC be a better system with just 15,000 people owning 8,793,200 BTC. How is this going to improve society?

Is this honestly how we are going to sell BTC to society? People are looking for real change.

sorry to disappoint, but bitcoin is not the future. it's the 18th century all over again. wealth and means of production are accumulated in the hands of the few, while the average joes in this game are fed and feed themselves with semi-religious believes about how they too will end up on the sunny side if only their faith in bitcoin is strong enough. all driven by one force: good old-fashioned greed.

"the creatures outside looked from pig to man, and from man to pig, and from pig to man again; but already it was impossible to say which was which."

Because Bitcoin is not controlled by a central entity that gets to award those closest to that central entity and punishes those furthest away from that central entity.

We are all on equal footing with equal access to Bitcoin. If you are not buying bitcoins right now, you have nothing to complain about. If you thought it was too risky the first time you heard about it and did not buy, you have nothing to complain about. If you have not been involved in your world that includes Bitcoin and just skate through life hoping for something better but not doing anything about it, you have nothing to complain about.

Those that work and take risk are being rewarded. Those people are improving society. Enjoy your diminished wealth if you are not one of them.

I am not trying to sell BTC to society. Society is what got us here in the first place.

Bitcoin is for me. It makes my life easier. If this is not true for you, do not use it. Enjoy your notes.

If we would give 1 Bitcoin to every person on earth, it would look the same in a year.
Most people would just sell it and a few people would see the potential and buy everything up, they can get.

Some people in here, know that I am a socialist. I don't believe in a completely free market. But even I, think you are delusional.

we are all on equal footing with equal access to factories and land. if you are not buying your own factory right now, you have nothing to complain about.

Freicoin is a commy coin. It loses value the longer you hold it. OP would probably love it.

This, those that actually produce will reap the rewards. Stay a cog in the wheel and let those that innovate move the world forward.

I do not buy bitcoin expecting to become rich.

I transfer my wealth from a bad currency to a good one.

Those who do not see it should stick with their notes. They deserve them.

People should just stop trying to see something in Bitcoin, which is not there.
There are some things, Bitcoin can do for poor people.
- Poor people are those, who pay the highest fees. With Bitcoin everybody pays the same(small) fees.
- A bank can freeze your account. If you don't have the money to pay a lawyer, there is not much you can do about it. Nobody can freeze your Bitocoin.
- A country can increase inflation by printing money. Most of the time the rich are better informed about it and they have a lot of their money in assets anyways. It's the poor, who get hit by that, not so with Bitcoin.

So, Bitcoin is already doing a lot for the poor, if they are able to use it and stop  whining about, that it didn't make them rich.

The OP is a non sequitur anyhow. How can X help society by redistributing wealth?

Redistribution of wealth does not help society.

QED

The distribution of bitcoins is not relevant to the distribution of wealth.

Bitcoins are not the same as wealth. Do you think it is unfair that only 0.5% of the people in the world own 100% of the Albanian leks? Think of all those unfortunate Americans that own no leks at all.


The distribution of bitcoins is insignificant compared to the distribution of wealth.

If you distributed all 21 million bitcoins evenly to every person on the planet, then each person would have about 3 mBTC, or about $1 USD worth. Do you think giving $1 to each person in the world will make any difference at all to anyone?

This is not what I am saying. I am not socialist. I am saying how is the general population supposed to buy into a system where the odds are stacked up against them?

Yes but if BitCoin was to get as big as some people want then they would be a reflection of wealth - period.

Finally some answers. Agree with your 3 points. And just to clarify I have no interest in getting rich. I have an interest in a fair currency.

Pretty much sums up my feelings on the subject. Its not a libertarians dream. Its a libertarians nightmare.

Elwar - refer yourself to the question in this post. How is BitCoin supposed to help the average joe in society when such a small minority own the lions share?

What exactly do you mean by this? Bitcoin is not a PoS coin (although many people would like to turn it into one) and current holders of BTC hold so special privileges. Latecomers might have missed out on some early gains, but that is pretty much it.

If anything, the distribution of bitcoins is not 100% correlated with the distribution of fiat, so this should improve overall wealth distribution if you believe that it is good (i.e. some fiat poor people might be Bitcoin rich and vice versa).

I mean with such a minority of players (around 15,000) holding 62% of the wealth how can Bitcoin possibly be a good thing for the little guy? This has nothing to do with my personal ideologies, but I fail to see how changing Bitcoin for the 'fiat' system would benefit anyone in anyway. 

Is every average joe in society the exact same person? Please describe how this person that represents every single person lives, works, spends his money, etc. on a daily basis then I can address this mythical question.

I can, however, speak for myself. I live in Germany working for a US company that pays me in dollars. Thanks to bitwage.co I can get paid in bitcoins. Thanks to localbitcoins I can turn those bitcoins into euros. This conversion actually nets me more money than I am paid in dollars because of the high demand for bitcoins for cash. I like the ease of buying things online with bitcoins instead of giving all of my credit card information, making sure I use whatever address they need to match up to my credit card, make sure my credit card isn't cancelled because I used it in some foreign country without calling the credit card company.

I like that my bitcoins are not run by a central authority who needs war and violence to continue its operation. That my bitcoins are not a currency that is on the hook for over $18 trillion in debt and climbing. I like that I can go to Prague for the weekend and spend bitcoins without paying for the high conversion cost to the local currency.

Average Joe will use Bitcoin or not. For me, it is helpful.

While it's certainly true that the distribution of BTC is not even. Just as you point out some have a lot, many have a little. But remember that distribution in the bitcoin economy is in the hands of users. If a poor person wants bitcoin they are in the same position as a rich person. There is no barrier other than their personal motivation.

Bitcoin (the coin) is not distributed. Block rewards are payment for the service of hashing and the more you hash the more likely you are to receive bitcoin. Any attempt to give coins to people because they are poor is just a distortion of the market. Since bitcoins cost money to produce, it's not even possible to do without someone getting stuck paying.

It's just like gold. Anyone can pack a mule and go to Alaska to try finding some. But nobody is going to give you gold for sitting at home and wanting it.

Enjoyed the last two answers :) - thank you. I will consolidate my thoughts and get back to you

It would be interesting actually to see current distribution of Auroracoin

Do you spend a large portion of your life worrying about what other people have compared to yourself?

Possession is not ownership*.  The major exchanges hold a lot of coins but those coins (legally) belong to the depositors. This can't be reflected by looking at the address distribution.  Using the graph you used to illustrate a point would be like graphing where all the US dollars are and showing that 5 "people" (BofA, Citibank, etc) have 95% of the dollars.  Yes their is unequal wealth distribution in the US (and everywhere) but simply looking at who is currently "holding" the assets as a bailor (http://en.wikipedia.org/wiki/Bailment) is pointless.

* That being said if you don't have the private key for "your" bitcoins then you don't have any bitcoins.  At best you have an IOU for some bitcoins owed to you which hopefully will be paid on demand in the future.

Not at all. Do you spend a large portion of your life trying to find flaws in people with different opinions to yourself?

The truth for fiat is that around 35% of the top 1% own all the money. 70% for the top 10%. (In the USA). Regardless of the exchanges its clear to see that distribution is actually worse for BTC. Has anyone actually read my first post or have they just read wealth distribution and already made their minds up?

Probably the latter ;) .

You base this on what?  People read your first post but you leap to unsupported conclusions because of a misunderstanding of terminology.
1 address =/= 1 wallet =/= 1 person. Due to the way that Bitcoin creates transactions most wallets will have more than one "funded" address.  They will also have addresses with a mix of value (some larger, some smaller, some left over change so small they may never be spent).   You assume that because there are 46 million non zero addresses that means there are 46 million unique entities and 95% of them have less than 1% of the total coins.  No it only means that there is a huge amount of spam in the network.   Most of those outputs below 1000 satoshis will never be spent and come from a period in time when the network had no anti-spam provisions.  As an example one company would send betters a single satoshi for each losing bet to provide confirmation that the bet was processed and lost.  Millions upon millions of them.  You treat each of those spam transactions as a single PERSON!




For the sake of the argument lets assume the distribution is as bad. You also indirectly assume that distribution won't widen.   At block 1 a single person owned 100% of the Bitcoins and now that is no longer true.  The Bitcoin money supply is ~$4B. The total wealth on earth is $263T.   Bitcoin is roughly .001% of the total wealth and is used by more than 0.001% of the planet.  

The rise in value of the Bitcoin money supply is directly linked to a wider distribution.   There is no scenario where Bitcoin will be worth tens of trillions of dollars and the same x people control 62% (your claim) of that.   It is a self solving problem.  Either the distribution widens (though commerce, speculation, and yes theft/scams/fraud) or the system won't increase in value.

What I like the most about your numbers are that that large percentage of bitcoin holders were here early on. They actually took the risks because they believed in Bitcoin and what it stands for.

The people who want to bring in regulations and redistribution belong to the small percentage. The longer that is true, the better. You really should try freicoin...that sounds like a better currency for you.

I do understand what you are saying. But why did YOU let this happen? Many who have a lot of coins have them because they took a big risk buying early. They had no guarantee that their $5 bitcoins would not drop to $0.02. They risked more and now they have more. Sure, now that they are hundreds of dollars each everyone wants $5 bitcoins. This relationship between risk and reward exists in all markets. I wish I could go back 10 years and buy an apartment in Dubai. I didn't take that risk and it would be unfair of me to demand an apartment now.

I have no problem with BTC. I don't really see how their risk would justify having 50% plus of the wealth if we were to convert to a bitcoin society (the risk was miniscule up to 2011, low hashing rates, low cost of coins). This is my main point. If BTC was to replace fiat how would it benefit mankind? Thoughts regarding this question are much appreciated. Telling me which coins I would or wouldn't like is not.

Just because I am talking about bitcoin benefiting mankind does not mean I am calling for regulation. Again putting words in my mouth is not actually appreciated one bit. I understand that its a topic you feel strongly about, but could you try approaching the subject in a non-arrogant, non-judgmental way :) . Ta

Spending $50 to purchase 5000 bitcoins in 2010 is high risk, but low cost. Buying an apartment in Dubai is substantially more risk as it could ruin your whole financial future. Show me one guy who chucked his life savings into BTC in 2010? 

I feel that that graphic has a tendency to misrepresent what's actually going on, I think that broad band of orange is including pool mined coins that go out to miners fairly quickly, it representing the expansion of pools, and the first hop of distribution rather than "spending" per se.

There was another study that said that 70% of bitcoins were sitting unused for months, that seemed to be "truthier" to me.

I was not responding to you.

If you don't know the benefits of Bitcoin, why are you here? Have you read the white paper?

Partaking in the Bitcoin economy is not the same as being a member of society in a particular nation state. If you find that you cannot use it in an empowering way you could always bail out - the choice is yours.

The graphic and 70% unused can both be true. If a wallet is unspent, how would it be included in a graphic about bitcoins being spent?

I understand fully well that BTC is and how a system like this could benefit society. What I am asking is how in its current form would it benefit society? In case you missed his ending statement, here it is one more time for you:

That is the reality.   Bitcoin is voluntarism at its finest.  People can't be forced to use it.  So people only use it IF it is better than the alternatives.  People are forced to use fiat and that forced use in the fiat world directly contributes to the unequal advantage a tiny minority have over the super majority.   That unearned and unfair advantage is what drives and reinforces the unequal wealth distribution.  
Unequal wealth distribution in the fiat world isn't the problem it is the symptom.   The problem is a system which gives the privileged (forget the 1% we are talking the 0.01%) a benefit and that benefit isn't free it is fully paid by the unprivileged and the worst part is you are forced into that system through a monopoly on violence.

(Edited for clarity)

I like both these answers a lot.

There you go then. If you know how it can benefit society, you have your answer.

If you don't like its current distribution, do something about it if you want, or not. Start a new alt coin and start distributing it evenly to everyone. They did that in Iceland with Auroracoin. Didn't work out as people had hoped.

I must ask you this. Do you think that monopolies are beneficial to society?

A monopoly cannot exist without force.

Perhaps gold is a better example then. I wish I could go back 10 years and buy $50 worth of gold. Or had I joined an investment pool to get that apartment I would have profited.

Okay then. How about for sake of discussion we take the dictionaries definition of monopoly - not personal definitions?

https://i.imgur.com/cGCGQUg.png

I don't personally think a gold standard would benefit many members of society. I believe BTC could, but not with its current monopoly. According to many members of this board BTC should not be an investment, therefore I don't want to compare it to an investment. I want to compare it to currency.

There is no monopoly.  You keep using that word but I don't think you know what it means.    You can mine new coins right now.  You can sell goods or services for Bitcoins.   You can take some of your non crypto wealth and trade it for Bitcoins.   There is no monopoly to access.

Lets continue at 10-100 the number of wallets stands at 115,281 and a combined wealth of 94.49%. This staggering wealth is owned by just 7.11% of the Bitcoin world.

Standard oil got called a monopoly with 70% of US oil production under its thumbs. If everyone was to switch to BTC tomorrow, for all extents and purposes a few would have a monopoly on the entire system.

Evidently Standard Oil was just one company. And the owners of BTC are individuals and I have no proof (and I don't suspect) they collude to form a monopoly. All the same, if all 7 billion people on planet earth decided to switch to BTC tomorrow then these few would have an extortionate advantage on the rest of us.

Again - I will refer to this line: If everyone was to switch to BTC tomorrow, for all extents and purposes a few would have a monopoly on the entire system.

Ok, I see that you are not really here to discuss the benefits of Bitcoin so I will leave you to your fiat. But if you look at any monopoly, their only existence is due to government force. I believe the solution you seek is guns and violence. Those are the only ways to bring "fair" distribution (and by fair, I mean fair as defined by the people with the guns).

Bitcoin is not a monopoly owned by a single entity. You could buy a bitcoin right now and no one person would own 100% of it.

I re-post my initial reaction to your OP with the appropriate image:

https://c2.staticflickr.com/6/5083/5371631857_303a5779fb.jpg

BTW, I'm not a "coin aggregator" I've got maybe 50 addresses counted in categories an order of magnitude below my total holding.... oh and a fraction on some exchanges, so probably part of one of the megawallets. Also a portion of Bitminters megawallet is "mine", that I can transfer at will, empty it about weekly usually.

edit: and I just realised that Satoshi probably isn't in the top 3 there, last I heard his holdings were all in single address 50 coin units, so he would account for some 19,000 or so of the wallets in the 10-100 range.

In my opinion - and I don't mean any offense - but its exactly this kind of attitude from BTC adopters that is actually going to stop BTC becoming mainstream. The points I made are extremely valid, that is if the world was to adopt BTC tomorrow, how could BTC help the little man with such distribution? You would surely end up with a few people with all the power and the rest without?

BTC adapters often point to BTC benefits for society and how it can help us rid the world of the evil fiat system. All I have done is turned this argument back on its head and said so how could this current system of BTC change the problems associated with the existing system. This is a question that has to be addressed and competently by adopters of this community if we actually want BTC to lead to real change. Its fine if you don't answer or don't want to answer or don't feel its any one duties to answer and innovators should sort all the nitty gritty stuff out, but that's not going to cut it with 97% of the population out there.

So fine, if you want to just ignore obvious questions that people would have about the implementation of BTC so be it, its no hair of my back. But I really wouldn't go around betting that BTC is going to take on the world if your not prepared to take on the responsibility of BTC taking on the world.  

~ Rant Over

Interesting to note, thank you. Is there anyway to confirm if Satoshi has not sold?

I frequently see a confusion between wealth and money.

If a single person owned all the money in the world, they would be quite wealthy, but they would only own a small fraction of all the wealth in the world. Money is a store of value, but it doesn't store all the wealth in the world. FYI, a person owning all the bitcoins would be wealthy, but they would not be the wealthiest person in the world.

If the goal is an equitable distribution of wealth through money, then the value of a currency would have to be proportional to the wealth of the person owning it. That way as money is exchanged, the wealth distribution is re-balanced to be equitable.

You should consider the ramifications: For example, wealthy people would only trade with other wealthy people in order to maintain their wealth. A more likely outcome would be that wealthy people would simply use a different currency.

Just for your information, I had no disillusions, the primary reason for writing is after reading numerous books on the subject. My argument focuses in on a scenario where a fiat society transfers to a btc society. In the aftermath the owners of mass fortunes can in effect buy out the world.

Irrespective of this you make some excellent points, I will let them digest and sink in and I will let you know what I think.   

For example, we might say Bill Gates has Billions of Dollars, but he may actually only own a thousand in actual issued circulating US currency at this particular point in time, he might have a few hundred thousand on a bank ledger somewhere, but still the bulk of his "wealth" is in the share valuation of Microsoft still, one would think, though he may have other holdings.

If the owners of mass fortunes can buy out the world in a BTC society, why can't they do it now? Or, do you consider it already done, and are looking for a way to return to an equitable distribution?

+1

I believe those commies should get a bit of their own medicine, i.e. guns and theft. That would cure them. Or perhaps it wouldn't.

Some people tell me that the 44 million impoverished "average joes" there would be better served by a proof of stake model....

https://nacla.org/sites/default/files/imagecache/large_image/wysiwyg_imageupload/16802/TrickleDown.jpg

Exactly. The US dollar is a monopoly. If you want to use dollars (you can't own them, just use them) then you MUST get them from the federal reserve. There is no other option. The fed controls how you may use them, where you may use them, they can change the value, they can increase circulation or reduce production. Why because it is a monopoly. Bitcoin is the opposite.

Everyone's making interesting points :) - now I am off to the pub. First round is on me.

I am really surprised that so many experienced users claim the unequal distribution of bitcoin to be not so bad, or even good. If you see bitcoin as a commodity this is acceptable, it is not if u see it as an aspiring global currency.

Our current unequal FIAT distributon is the result of centuries of exploittation and social unfairness, bitcoin achieved a worst result in 6 years. Why? Because it was needed to compensate the risk taken by early adopters by overvalutate their coins by 10000%? How much did they risk? Some hours of household hardware mining? Like now, with the current price, the unequal btc distribution reflect also the pre-existing buying power unequity, but I suppose this is mostly due to earyl adoption.

I just love bitcoin, but I don't like that few people already hold a large stash of the total bitcoin that will ever exist, and they got them with minimal risk.

Did it occur to you that the "dabblers" might think they own coin by having some in an exchange account, thus contributing to a megawallet somewhere. Then the enthusiastic adopters have been giving out 0.001-0.1 BTC paper wallets and tips all over the place, thus expanding the ranks of the BTC "poor" rather than BTC destitute (having none).

So with the possibility that multi thousand BTC wallets represent the combined holdings of several thousand people, and also that one person may control thousands of wallets, I don't see why it should bother me at present.

A couple of years back if you gave 100 BTC to a wealthier guy and a poorer guy, what do you think happened? The wealthy guy said gee thanks, and put it away, the poorer guy needed the money shortly afterward and cashed it in for a couple of hundred bucks. So even if you GIVE it out equitably it doesn't stay equitable.

Dude. The answer is obviously 42.

All Hitchhiker's Guide jokes aside, both you and General_A continue ranting rather than respond to the excellent points made in response #42 of this thread made by Death and Taxes. Until you digest those points and figures, and respond to them specifically, you'll likely get nothing but that same answers you find unsatisfying -- because you keep harping on the exact same whine.

Minimal risk? There has never been a point in Bitcoin's history where the risk of failure was less than it is now. If the price of a bitcoin rises to $3000, are you going to give away 90% of your bitcoins? After all, you got them with minimal risk.

I suggest that you create a coin whose distribution is fair and gains by early adopters are limited. If you are correct, then everyone will abandon Bitcoin and invest in your coin because it is better for them and everyone else.

That's why it would had been better to start denominating things in bitcoin before wide adoption, not using it from the start as a speculative asset :)

The distribution could be not exactly what the OP showed, but I think it is unquestionable it is largely unequal among users. Few people detain a lot of the total purchasing power that bitcoin could ever have, this is not good imo. I'm not saying that I have a simple solution, only that this is the aspect that I less like about bitcoin.

the wealth distribution is worse than in any other currency, correct.

I didn't read Elwar's comments but i believe it's safe to put him on ignore.

You figure out a way to do that, and the world will beat a path to your door. Oh yeah - I see the smiley now.


Yet unlike fiat, no one is, nor ever has been, barred from participating. Can't get any more egalitarian than that.

I really don't see the problem here. 

Yes, there are a few who own a disproportionally large amount of Bitcoin, but why does that matter?  Bitcoin is divisible down to one millionth or a Satoshi, and there is further subdivision capability if needed. 

 If the "bitcoin rich" just hold on to it, the value of the rest of the circulated bitcoin will rise, and if they spend it then they are spreading the wealth around.  It is all good.

And forced redistribution of wealth has led to history's worst atrocities.  And in reality, the numbers won't make anyone rich or do anything but buy a month or two of living if all wealth were redistributed equally.  Volume of exchanges and class MOBILITY is what matters, and that involves a free market, which I assumed Bitcoin represented.


Stop with the class warfare neo-marxism crap.

The problem is not the price, or the divisibility: the matter is that few people control more than 50% of the purchasing power that the whole btc economy will ever have.
I do not like this centralization of purchasing power.

I can understand you don't like it but how is that an actual problem? I keep reading "the odds are stacked against you" and things like that but it's not like we need to fight to death with each other, or do we?

Someone comment on the divisibility of bitcoin.

There are coins which tried to set the distribution to an equal amount for one person (e.g. Auroracoin for Iceland). Then there are coins like NEM which tried to make the initial distribution as equal and widespread as possible by distributing the coins for free at first and then for a small amount of BTC, removing sockpuppets, and setting a limit of stakes per NXT account.

The skewed distribution of Bitcoin wealth is a legitimate concern but it's not something that we can really change. They are the early adopters who took the risk and invested/mined when the BTC was worth pennies while the rest of the world watched and laughed. Besides, most of the earliest adopters were libertarian computer geeks like Satoshi and Hal Finney and I guess it's better to have them in control of the majority of the world's wealth than the bankers and politicians of today.

Modern fiat money distribution is magnitudes worse than bitcoin: A few guys own the central bank get ownership of every newly created dollar, and old dollars are backed by gold which is also hold by the same people, the number of these bankers are a few. The people who made those fiat money wealth statistics typically don't even understand how fiat money works

Money is only one type of wealth, holding a lot of bitcoin only grant some part of the whole bitcoin ecosystem's value, you are still investing in an unknown possibility

And, the top address in bitcoin are mostly mining farm/pool account or exchanges account, the coins in those accounts are typically collectively owned by thousands of users

If you don't like Bitcoin's distribution, you'll hate Ripples.

With Ripple, 3 people own 90% of the coins.

Let's assign a monetary value to something that has already been distributed equally, like kidneys, everyone has 2. Let's say they're worth $5000 each, and let's say the market in them is completely free.... In 5 years time, what strata of society has the least kidneys?

serious thread deja vu.

Hating on the Bitcoin distribution always misses the point.

The current global fiat/financial system is broken and concentrates wealth upwards. Rich get richer poor get poorer. Why? Because it's a an opaque rigged casino, with the banks, credit card companies and JP morgan et al owned high frequency algorithms siphoning off value on every single transaction.

The point being, that until the current playing field is levelled, open and mathematically honest there can never a fair distribution of wealth let alone an equally distributed one.

Even a person born after all the Bitcoins are distributed and earning a tiny trickle of Bitcoin through hard toil will be better off than in the current system.

 As it is, they are playing a rigged game without knowing the rules, blindfolded. Be a part of a possible solution, buy a few coins and give them away to those less fortunate in 10 years time. Charity is one of the best use cases.

The only concern about bitcoin's distribution design is its steep setting of reward halving, which dramatically benefit the early adopters

Satoshi could set the reward halving scheme to reduce the block coin generation by 33%, or even 25% every 4 years. This will not change the nature of total limited supply, but give people much more time to join the mining and grab some bitcoins while exploring the possibilities of bitcoin

With today's 50% reward halving, it generated strong motivation to adopt as early as possible. This will have a huge advertising effect in the first several years while everyone want to join the mining game and grab their share before it is too late, but when most of the coins were mined out, the motivation for late comers can be a problem

Of course when the system is widely adopted, the transaction fee will also rise to compensate for the block reward, hopefully we will reach that state in 10 years, when the block reward is 6.25

Anyway, from a larger perspective, most of the easy gold has been digged out (170K tons in existence and now yearly production of 3k tons, means less than 2% increase per year) but still works as most honest money, so the initial distribution is not that important since it is usually the production cost decide its value

http://www.midasletter.com/wp-content/uploads/2014/04/mine-supply-gold-2013.png

This is bitcoin we are talking about,everything can happen

Yah, everything can happen, on the same day, 30 news articles, and market be like...

"LOL didn't read"

Next week, dead, apart from "Ashton Kucher gets sliver off plywood BTM case at Bitcoin Hackathon" .... market plunges 20%

+1

This is a very interesting argument and one can possibly agree on both sides of the coin.

On the one hand you have the minority early adopters like all the CPU/GPU miners that amassed ridiculous amounts of coin and held throughout, Satoshi, and the Winklevii, etc...

Then you have the late comers that are just trying to enter the space, but are finding the price of entry too high.

It's quite a quandary we have here.  Trying to bridge that gap between the "wealthy elite" and people trying to enter the club.

Personally, I think that's where "Bits" or "mBits" come in.  As development, investment, and adoption continues on an upward slope, we'll have to implement the technology to transfer, pay, remit, and transmit as fast as the fiat, click, and card swipe system.  For smaller transactions under $100, this should be a given.  For larger ones in the thousands, it'll definitely has to be faster than the 10 minute wait times we usually experience.  No one should have to wait 5-10 minutes for a confirmation to see if their flight booked or if their new Dell laptop purchase finally went through.

If the whole ecosystem speeds up and deals more with "Bits/mBits" on a daily basis more often, then they'll use it enough, that'll become a real viable method of payment and become treated like "e-cash", the way Satoshi's experiment originally wanted it to.

If we get to this point with millions of people transacting these small and medium amounts, "Bitcoin" the larger amount and commodity like cryptocurrency value will probably rise, and these early adopter bag holders will likely spend on "houses" and "cars" and "vacations" and "jewelry" and pour it into "businesses" etc...

Get the small timers involved and big timers will get involved as well.  Bitcoin is like a grass roots movement, and the wealth will be redistributed once the people on the ground start using it, causing the BTC wealthy at the top to take notice to lend a hand and redistribute.

This would be a problem only if all wealth in the global economy was suddenly represented solely by Bitcoin. However, it is important to remember that Bitcoin represents only a small portion of the real economy. The wealth distribution within that small portion of the economy doesn't really matter because it ignores other assets. For example, I own a very small fraction of all Bitcoin in circulation, but for all you know I could still be a billionaire. I might be wealthy despite the small amount of Bitcoin I own. If I wanted to increase my Bitcoin holdings I could shift my current assets more towards Bitcoin.

The current distribution represents the fact that most people are not very invested in Bitcoin. Only a small portion of the global economy is represented by Bitcoin and a few individuals own a large percentage of that small part. The distribution will likely even out as more and more non-Bitcoin assets are exchange for Bitcoin and Bitcoin begins to represent a larger portion of the economy.

Again, the current distribution simply doesn't matter. If you look at this from an equality of opportunity/wealth distribution perspective, you are completely missing some very important points.

Everyone reading this post is an early adopter. In 5 years, people will complain about how unfair it is that you amassed ridiculous amount of coin. How will you respond to them?


The price of entry is no higher than it was 4 years ago. Now, just as then, if you want to own $1 worth of BTC, you can own $1 worth of BTC, and it will cost you about $1.

So Bitcoin stops being magic beans for the miners, and becomes actual money for the masses. Money that people will need to earn by applying their efforts, before they are rewarded with purchasing power. Oh the horrors. How could such a money ever hope to work?

Yes, in the larger scope of things of the technology curve, it could be still considered the "Early Adopter stage".

I'm referring to in the 6 year fast moving history of Bitcoin, only the miners that started in the CPU/GPU age back in 2011 to early 2013 really benefitted if they held and amassed their coin.

To the people who became interested in 2013 after the Gox and price spikes to just shy of $1200, you can say we're "latecomer".

I'd consider myself a "latecomer/newcomer" in Bitcoin years, since I arrived to the party in late 2013.

To the average person on the street, they don't know about millibits or fractions of a Bitcoin or definitely not "Satoshis".  If they actually know a little about Bitcoin, they'll reference the whole Bitcoin price of $300, because the average person doesn't deal with 8 decimals on a regular basis.

So to answer your retorts, you're actually right about your points overall.  For the people that aren't as versed as you or I or the people of this forum, this "internet of money" called Bitcoin has a steep learning curve and can seem intimidating and scary, then just pulling out a $20 bill to pay something.  You have to go get the lowest common denominator first to accept and actually use the tech, before the whales and early adopters can splash the pond.

Then it sounds like you need another coin.

Perhaps fork Bitcoin to change the distribution. Or create an alt coin.  See how many people follow.  Or not. That is freedom. 

Like I said in my earlier post, this is only true if you ignore the fact that Bitcoin is only a small portion of the wider economy.

It is fair because the free market is one that allows for winners and losers. If everyone has the same the market will collapse...there will be no demand, and subsequently no supply.

Okay, I'll fix this....

This week, each one of you has a homework assignment. You're gonna go out, you're gonna start a talk with a total stranger, you're gonna start a talk, and determine their net worth, if it's under $50,000, pull a glock and force them to buy greater than 0.3 worth of bitcoin.

Because most people on this forum don't hate Banks and the Financial Elite because they're scummy, most people here are upset THEY aren't the ones at the top. We could dig up the tons of "we're the new financial elite" posts.

I know you are sarcastic, anyway you can do that at any time. For the price of a pizza you can have a share in a good wealth producing company. Prioritize otherwise, take ownership in some capital, and you can spend more later.

Right now the system is somewhat rigged, and the prudent saver is basically fucked. You have to lick ass of agents the non voluntary organization called government, now, if you want to play.

That is what we are going to change with bitcoin. We are not taking away capitalists and entrepreneurs, rich heirs (and playboys and bad music and a lot of other bad things). Only the rigging of the game.

How is BTC going to stop the rigging of the game? Do you honestly think when there was a gold standard and money wasn't printed on a screen somewhere then society was somehow less rigged for the average man? It wasn't. The power and wealth was even more tightly concentrated during the gold standard period. BTC does not somehow magically circumvent this with its technology, regardless of its attribute of being unprintable. There will be a few with all the power and the herd scrapping for the scraps once more. Your argument is based on little facts, little evidence and little historical perspective.  

Could be, but not because of the sound money (if you by gold standard mean sound money). Some people inherited money and land, which is ok (if you can't give your possessions away, you don't really own them), but if you follow the story back in history, there was robbery. Some king took the land by force, and gave it to some agent, maybe a general, as compensation for his assistance to kill for the king.

What we can have with sound money is +no bank bailouts (because there is no money to bail them out) +commercial debtor insurance only (same reason), +stable money value (or slightly increasing due to progress) +saving in money made possible +market based interest rate unfucking the current system of systemical misallocation of capital +smaller governments because they can only loan prudently and taxes will have to be less. It is rather a lot. Big changes ahead if this succeeds.

Going to sound money will not automatically reintroduce everything from the old days. You dont need slavery, and you don't have to go back to the productivity levels of yore.